101. Diplomatic Note From Secretary of State Rogers to the Ambassador of
Thailand (Hongladarom)1

Washington, December 10,
1970.

The Secretary of State presents his compliments to His Excellency the
Ambassador of Thailand and has the honor to inform him2 as follows.

With regard to the proposed PL–480 sale
of rice to Indonesia,3 the American Embassy in Bangkok has
relayed to the Department of State [Page 205]a request, received from the Ministry of Foreign
Affairs,4 that the United
States consider buying a portion of the rice from Thailand in a manner
similar to Japan’s purchase for Indonesia. Should this be impossible the
message suggested that the proposed sale be delayed until the end of
April.

At the December 1969 meeting of the Inter-Governmental Group on Indonesia
(IGGI) the United States pledged to
contribute a fair share of the $140 million estimated food aid
requirement for the 15-month period ending March 31, 1971. This
assistance is still considered vital not only for its direct impact in
conserving foreign exchange and stabilizing prices but also because of
the local currency generated for support of the development program.
Although Indonesia had anticipated that the United States would provide
up to 450,000 tons of rice and had in fact requested a greater quantity,
the total to be provided is not expected to exceed 400,000 tons. This
would include 240,000 tons from the April agreement, the proposed sale
of 110,000 and a possible additional 50,000 tons early next year. Any
delay in arrival of PL–480 rice beyond
March 1971 would fail to accord with understandings reached at the
December 1969 IGGI meeting.

With regard to the suggestion that the United States buy Thai rice as has
been done by Japan, it is regretted that this would not be feasible in
view of availabilities of United States rice and the United States
balance of payments considerations. It is understandable that Japan,
which has a large surplus in its bilateral payments with Thailand,
should wish to find measures to ease this imbalance. On the other hand,
the United States is still a net contributor to Thailand’s balance of
payments.

Although the assistance provided by the various countries has helped to
improve the situation following the serious financial strains which led
to formation of the international assistance group in 1966, Indonesian
recovery and development requires that foreign exchange resources
allocated to food purchases be kept to a minimum. However, as a result
of this assistance Indonesia has had the resources to purchase
commercially on the average as much or more rice than was possible in
1965 when no rice imports were obtained under the United States PL–480 program. In supplementing
Indonesia’s resources and enabling them to continue to make commercial
purchases of rice as well as other vital commodities this Government
believes that the program, on the whole, has been helpful rather than
harmful to Thailand.